Gold trading is shifting to blockchain. Can Bitcoin still shake its position?

Bitcoin, a blockchain-based digital currency, is often considered to be a global safe-haven asset like gold. In this era of global turmoil, even gold has become unreliable and may be confiscated like in India. Some people have begun to believe that Bitcoin can replace gold because Bitcoin has some capabilities that gold does not have, such as low handling fees, fast transfer capabilities, and decentralized nature, in addition to the reserve capacity of gold. As the use of Bitcoin continues to become more popular and volatility continues to decrease, the status of gold has begun to be threatened. So what if gold also uses blockchain for transactions?

Goldmoney, a global gold reserve and payment network, has launched a new blockchain platform that allows users to buy gold held in the vaults of the Royal Canadian Mint. These gold transactions will be recorded on a private blockchain. Buyers only need to pay a 0.5% handling fee and can also enjoy an additional storage service of up to 1 kilogram of precious metals.

Josh Crumb, Goldmoney co-founder and chief strategy officer, explained:

“We are early blockchain enthusiasts and are very interested in the technical principles of blockchain. So we created a blockchain platform to cover the gold industry, using blockchain to verify the movement, price and settlement of gold. In essence, this platform can help customers confirm the existence of gold.”

Goldmoney spent three years creating its own private blockchain, a project led by CTO Alessandro Premoli, an early member of the blockchain community, advisor to Ripple, and regular contributor to open source projects.

John Moore, Vice President of Sales at the Royal Canadian Mint, said:

“We are pleased to join the Goldmoney network and provide Goldmoney and its network users with access to our highly secure storage services in our Ottawa vault. We also look forward to working with Goldmoney on future marketing initiatives that showcase Canada’s leadership in the global precious metals industry.”

Goldmoney offers a wide range of trading services, including the purchase, sale, exchange and redemption of physical gold. Goldmoney works similarly to Bitcoin in terms of value transfer. Goldmoney network members can purchase precious metals and transfer ownership to other members via email or text message. The recipient can then redeem the value of the gold in local currency to a bank account or a Goldmoney MasterCard. Transactions are typically completed within a day and have a 1% fee.

Nowadays, more and more blockchain projects are beginning to involve gold. According to recent reports, the Royal Mint, which has a history of more than 1,000 years, the only licensed minting institution in the UK, announced that it will launch a blockchain gold product. The Royal Mint (RM) of the United Kingdom has cooperated with the Chicago Mercantile Exchange Group (CME Group) to jointly create and launch a digital gold product that allows users to use a blockchain-based system to execute, settle and trade gold.